Devon's Ambrosia custard factory is to be sold as owner Premier Foods said under-fire chief executive Gavin Darby will step down on January 31.

Mr Darby's departure will end a six-year tenure at the group and comes after a public row with activist investor Oasis Management, which claimed he has presided over years of value destruction.

On the sale of Ambrosia, based in Lifton, Devon, Mr Darby said: "The board has determined that it should focus resources on areas of the business which have the best potential for growth through accelerated investment in consumer marketing and high return capital projects.

"Accordingly, we are pursuing options to fund these plans as well as delivering a meaningful reduction in net debt, through discussions with third parties regarding the potential disposal of our Ambrosia brand.

"Although there is no certainty that any transaction will complete, we will update shareholders in due course."

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Mr Darby added: "Having today announced a new strategic initiative for the business, I have decided to step down as CEO on 31st January 2019, which will mark the sixth anniversary of my joining Premier Foods.

"The board will now begin a recruitment process for my successor."

Premier's half-year results also announced on Tuesday showed pre-tax losses widened to £2.2 million in the six months to September 29.

At Premier's annual general meeting in July, 41% of investors voted against Mr Darby's re-election.

Oasis had called for his departure, claiming he had presided over value destruction and having been critical of his strategy in the past when he oversaw the successful defence of a takeover tilt from US firm McCormick in 2016.

There was also investor discontent over Premier's recent decision not to sell its fast-growing Batchelors brand.

In its half-year results released alongside details of the planned changes, Premier said it had "reflected upon the expressed views of some shareholders at the AGM".

The potential sale of Ambrosia is seen as an olive branch, with the division the group's third biggest brand.

Ambrosia, which is famous for its Devon Custard and Rice Pudding, was 100 years old last year and has been produced in Devon since the factory opened in 1958.

Martin Deboo, an analyst at Jefferies, said: "We get the logic, as Ambrosia is highly separable (a single factory in Devon) with associated minimal stranded cost."

He said the success of this disposal would depend on the price achieved and was "one to watch".

Premier's half-year results also announced on Tuesday showed pre-tax losses widened to £2.2 million in the six months to September 29.

On an underlying basis, pre-tax profits rose 14.3% to £30.2 million.

History of the Lifton Ambrosia creamery

The creamery was founded in 1917 by Albert Morris in Lifton. He was inspired by his fishing weekends in Devon where he stayed at the Arundell Arms. Named Ambrosia, which means 'food from the gods' he employed around a dozen locals to make rich food for infants. He took milk from local farms where most of the cows were the Red Ruby breed, and dried it with roller dryers.

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The product soon came to the attention of the British armed forces, who took significant quantities for its soldiers, still fighting in the First World War.

Just prior to the Second World War, the Ambrosia creamery was the first company to start making creamed rice pudding ready in a tin. Meanwhile, Alfred Morris decides to buy the Arundell Arms, establishing the inn as a retreat for organised fishing trips. Alfred died in 1936, passing both the Creamery and the pub to his son Oscar Morris.

During the war itself, Ambrosia sent dried milk to help feed children at the time of milk rationing and when many mothers were working in factories to support the war effort. Creamed Rice production is limited to War Office contracts only and included in Red Cross Prisoner of War parcels. Ambrosia received hundreds of letters after the war from prisoners who found Creamed Rice the most welcome product in the parcels, with several saying they 'owed their lives to it'.

After the end of hostilities, Ambrosia relaunched the product, along with a creamed macaroni pudding.

In 1956 Oscar Morris retired and sold his controlling interest in the company to Virol Ltd, whose parent company was Bovril Ltd. As a result Ambrosia could afford to advertise for the first time. In 1957, following increasing demand, the creamery opened a new factory near to the original production facility.

In 1961 following Oscar Morris' death, the Arundell Arms is sold to Gerald and Ann Fox-Edwards and remains in the family today.

Ambrosia lanched the first canned Devon Custard, made on the reort canning lines in Lifton. By the early 1970sfollowing investment in the latest canning technology, the quality of Ambrosia Devon Custard is further improved and Ambrosia becomes the brand leader in 'ready-to-serve' custard.

One of Ambrosia's main selling points is the fact its made in Devon using local milk, later to become immortalised in the advertising slogan 'Devon knows how they make it so creamy'

Investment in new equipment and technology means Ambrosia Custard could be sold in convenient modern cartons as well as cans during the 1980s. A low fat rice pudding is introduced as an early example of a low far product reformulation which is still sold today.

The 50th anniversary of Ambrosia Creamed Rice is marked by the development of a new process and packaging equipment to introduce the product in long shelf life, single-serving plastic pots. New pots are launching including Low Fat Rice, Devon Custard and Chocolate Desserts.

In 1990 the entire company was acquired by Colman's Ltd., a famous brand of mustard. This in turn was bought out by Unilever in 2001. Unilever sold the brand on in 2004, to Premier Foods, where it is still a core brand, alongside others such as Bisto, Branston and Hovis.

Recently, the company has launched Ambrosia Deluxe Custard. The launch of Ambrosia Frozen Custard represents the brand's first entry into the frozen desserts market. An upgrade to the development kitchens positions the Lifton site as Premier Foods' centre of excellence for desserts innovation.

Steve Pretty, the manager at the Creamery in Lifton said: "We're very proud of what we do here on site and I hope you all continue to enjoy eating Ambrosia Custard and Creamed Rice."